Twitter has raised $200m (£128m) in new funds in a deal that values the microblogging platform at $3.7bn. Chief executive Dick Costolo tweeted that the new funding will "help grow Twitter to infinity and beyond'', fuelling rumours that the company may be among the first of the new generation of internet firms to join the stock market.

The fundraising comes at the end of a year that has seen huge sums bet on social media companies. Analysts believe a number of them could float next year, generating fortunes for their founders and investors. At $3.7bn, Twitter would be valued as highly as mainstream US media groups such as Gannett and The Washington Post Company.

The company has previously denied looking at an initial public offering. But analysts said the size of the new investment, which came mainly from the Silicon Valley venture capital house Kleiner Perkins Caufield & Byers, and the current enthusiasm for social media companies suggested that Twitter was likely to go public sooner rather than later.

Sandeep Aggarwal, internet analyst at Caris & Co, said $200m was a lot of money but that, given the firm's phenomenal growth, Twitter would soon need more. "We expect a lot of social media companies will go public next year. These companies have a lot of traction not just with users but with advertisers," he said.

Officially, Twitter is giving little detail on how it will spend the cash. In a posting on its corporate blog, the company said: "In the past 12 months, Twitter users sent an astonishing 25bn Tweets and we added more than 100m new registered accounts. In that time, our team has grown from 130 people to more than 350 today."

Twitter now has 175 million users, up from 25 million in 2009. Some of the new money is expected to be used to upgrade its systems, recruit staff and expand its offices. The company is believed to be looking for offices in London; Britain is Twitter's second biggest market.

At least five other internet firms have received more than $100m in new funds this year, including user-reviews site Yelp and games publisher Zynga, creator of the popular Facebook game FarmVille. Earlier this month, Google is believed to have offered $6bn for Groupon, a company that uses social media to offer group discounts to its users.

Facebook, by far the largest social media site, is believed to be planning an IPO that could come as early as next year. Aggarwal said Facebook could be worth more than $40bn, making it more valuable than eBay, Time Warner or Thomson Reuters and putting it on a par with Boeing.

The latest investment in Twitter is the second largest sum invested by venture capitalists this year after a $350m investment in Better Place, a company building a network of charging stations for electric vehicles.

Twitter also added two new members to its board: Mike McCue who founded Flipboard, one of the hottest iPhone applications of the year, and David Rosenblatt, chief executive of internet advertising company DoubleClick.